Apple declared itself "thrilled" as its quarterly profits leapt by 70% to $4.31bn and its revenues by 66% to $20.34bn as it sold 14.1m iPhones, up 91%, and 4.19m iPads.

Its shares moved down in after-hours trading, losing nearly 6% to fall below $300 in profit-taking. Apple's revenues were more than 10% above earnings forecasts, and its profits 5% ahead.

The company sold 3.89m Macintosh computers, beating its record set in the previous quarter. The only dull spot was the continuing fall in iPod sales, down to 9.05m, though the company said that it was maintaining its share of that market.

After the results were announced, Steve Jobs, its chief executive, made a rare appearance on the earnings call with analysts, saying: "I couldn't help dropping by for our first $20bn quarter." Those revenues easily put Apple past its biggest rival, Microsoft, which has not recorded a $20bn quarter, though its next quarterly figures are due presently.

Jobs hinted Apple's $50bn cash pile could be used for a sizeable acquisition: "We strongly believe one or more very strategic opportunities may come along that we're uniquely positioned to take advantage of. We don't let it burn a hole in our pocket or motivate us to do stupid things. We do feel there are one or more strategic opportunities in the future."

Jobs then laid into Apple's principal rivals in the US smartphone market, Research in Motion and Google's Android, and suggested that tablet computers will change computing in the future.

"We've now passed RIM [which sold 12.1m phones in the comparable quarter], and I don't see them catching up with us. It's going to be a challenge for them to become a competitive platform and to persuade developers to develop for a third platform after iOS and Android."

He also forecast that would-be rivals to Apple's iPad tablet computer would struggle to make a mark because many were offering screens only 7" diagonally – "which is only 45% of the area of the iPad," Jobs said. "We think these 7" tablets will be DOA – dead on arrival. They'll learn the painful lesson that they're too small and have to expand them next year."

He pointed out that Apple is already selling more iPads than Macintosh machines, and suggested that the tablet market is "a new model of computing … I think we've got a tiger by the tail here".

Asked whether rival tablets so far announced – which will run Google's Android 2.2 software, and have 7" screens – posed a threat, Jobs was scornful. "You might think a 7" screen would have 70% of the size of a 10" screen, but that measure is diagonal. In fact it's only 45% of the area of an iPad screen. If you take an iPad and draw an imaginary horizontal line halfway along, that's the size of a 7" tablet display."

He added: "The only way they're going to sell is if they come with sandpaper, because you're going to have to sand peoples' fingers down so they can work it. You can't run the software you need on a screen that small."

He added that the reason PC manufacturers had not been able to challenge the iPad was that they did not specialise as it did. "We've done everything from the iPad's A4 [processor] to the battery chemistry. We've learnt a lot from the miniaturisation on iPods and iPhones. We're a very large volume consumer electronics manufacturer. We're systems architects, we know how to make products in an interesting way. This is a product we've been preparing for for the past decade."

The company said the growth in iPhone sales was ahead of that for the general smartphone market, put at 64% by IDC.

Sales will probably accelerate when Apple begins selling its iPhone on the Verizon network from January.

The company said it could have sold even more iPhones if it had been able to meet supply, with 3.3m left in its supply channels.